Thursday, September 20, 2012

Tax transparency in Canada-report

I recently posted my Canadian National Report prepared for the Vienna University of Economics and Business, Conference on tax secrecy and transparency, Rust, Austria, July, 2012. From the abstract:

The aim of the project is to assess how different countries regard the treatment of tax information and tax secrecy. Topics include the collection of data, the sharing of information domestically and internationally, interaction of tax rules with related regulatory rules, and access to taxpayer information by the public. This report discusses Canada's relatively low profile in the global market for offshore financial services. Overall, Canada’s tax regime attempts to strike a balance between protecting taxpayer rights to privacy and confidentiality, and ensuring that the government has sufficient information about taxpayers in order to enforce its own laws, as well as to cooperate with efforts by other countries to enforce their tax laws in respect of their residents who invest in Canada.

I invite you to download the paper from SSRN here. (link fixed, i think)

I think he overstates the Richardson case too much. In fact if look at other sources the CRA and its predicessor agencies believed that Richardson was no longer in force due to changes ITA changes after the fact(Richardson was not actually decided on the basis of the Charter although a charter claim was made during the case). It was only the last two years if a remember correctly that a Chinese Restuarant in Vancouver that was caught skimming cash made a defense based on the principles in Richardson which the court ruled were in fact guaranteed by the Charter notwithstanding after the fact changes to the ITA. This is discussed in the above link but not as much as it should be.

On the privacy law issue one thing to remember is PIPEDA applies only throughout the entire country to the traditional deposit taking activity under the Bank Act. The securities and insurance subsidiaries of the Chartered Banks in BC, Alberta, and Quebec are subject to the provincial privacy law regimes of those provinces in leu of PIPEDA(In other provinces insurance and securities activities continue to be subject to PIPEDA). Generally the Alberta, BC, and Quebec privacy law regimes(which the federal government allows delegation of in leu of PIPEDA) are generally similar in principle however there are some differences which I forget offhand. I know privacy "waivers" are not permitted in Alberta. Additionally courts in Manitoba and Ontario have ruled that even in the existence of PIPEDA their continues to be a "common law" right of action in cases of privacy breaches in those two provinces(Does this applied to "Bank Act" activities???). (I am not at all an expert on the Quebec Privacy Regime vs the Quebec Civil Code there might be something their but I am not the one to ask).